London Daily

Focus on the big picture.
Sunday, Oct 04, 2026

Suez Canal blockage could alter shipping forever…and China and Russia will be the winners

Suez Canal blockage could alter shipping forever…and China and Russia will be the winners

The need for alternative international shipping routes has been highlighted by events on the Suez Canal over the past week. And with their plans already taking shape, Beijing and Moscow are well positioned to capitalise.
The Suez Canal’s recent spell in the limelight has turned out to be quite revealing. The strategic waterway has dominated headlines for a week after a giant container ship, the Ever Given, got stuck in sand and mud at the canal’s southern end, blocking it and bringing shipping to a halt.

The welcome news emerged yesterday that the crisis is finally over and shipping can resume, but it won’t be without repercussions. In a world already battered by the Covid-19 pandemic – which itself has had huge implications for shipping – the blockage of the canal is a firm reminder of just how fragile core transcontinental shipping routes can be.

This was a relatively short blockage, but its consequences will be felt for a long time and will serve as a boost to China and Russia, both of whom are introducing new game-changing intercontinental freight routes.

The Suez Canal is a product of an era during which globalisation, as we understand it today, was emerging, to facilitate the flow of free trade as well as the naval aspirations of empires such as the British and the French. Cutting through the dividing line between the African and Asian continents, its creation was a revolutionary feat which strategically connected the Mediterranean with the Red Sea and the Indian Ocean, giving a direct intercontinental shipping route from Europe into Asia. No longer was the time-consuming, tremulous journey around the Cape of Good Hope necessary, and the canal’s existence allowed the British to exploit India to their own wishes. In short, Suez changed the world.

As a result, it is no surprise that various episodes in the Suez throughout history, no matter how brief they may have been, have played a key role in prompting big geopolitical shifts. The Suez Crisis of 1956, whereby Britain sought to regain strategic control of the canal following its nationalisation by Egypt’s President Nasser, proved to be a moment of reckoning for British Imperialism.

The dual opposition from both the US and the Soviet Union forced London to recalibrate its long-held outlook of being a global naval power, and instead turn towards Europe. Given this history, it’s not outlandish to recognise that this Suez crisis will also have big consequences, even though there was no military dynamic.

Although the Ever Given hold-up was just a week, it has proven expensive. The estimated costs of blockage in the canal amount to around $9 billion per day and could have a run-on effect of reducing annual global trade growth by 0.2-0.4%. It also sent the cost of shipping up temporarily by 46% as ships were forced to avoid the canal and transit around Africa, with longer and more inconvenient journeys.

It is inevitable that faced with such circumstances, shipping and freight companies will inevitably seek out cheaper, less risky and more effective routes. And most crucially the crisis has come at a time when new alternatives are appearing which are likely to be more competitive than Suez on every level.

The first one is China’s Belt and Road Initiative. Beijing’s global project has invested hundreds of billions in the creation of new ports, railways, and roads on multiple continents, all of which are changing the logistical landscape. One of its most powerful achievements has been the initiation of multiple China-Europe Railway routes, where new cargo trains allow freight to be shipped directly from cities in China across Eurasia as far west as London and Portugal.

There are two main arteries to this project; one which reaches Europe via Russia and branches out into individual countries, and another which crosses central Asia, transits through Turkey, extends up through the Balkans and terminates at Prague.

These routes have dramatically reduced the shipping time for goods across the continent, and as a result of Covid-19, the volume of cargo has surged to a record high.

Secondly, there is Russia’s Northern Sea Route across the Arctic, which extends through the country’s exclusive economic zone and allows a through-route from one end of Eurasia to the other. Moscow is investing heavily in infrastructure as well as ice breaking ships, touting it as a slick alternative to the risks of Suez.

China is also interested in the far north, too, pledging to create a ‘Polar Silk Road’. The opening of this previously closed region for commerce will undoubtedly speed up shipping times and comes as a part of a ‘strategic competition’ for the Arctic region as a whole, with President Trump’s administration having aggressively renewed America’s interest in Greenland.

The last week’s problems in Suez therefore echo the past. While historically great powers such as Britain and France sought to establish and control the strategic route in pursuit of commercial gains, the grounding of the Ever Given illustrates how the powers of today are continuing to compete in creating and sustaining new shipping routes which will completely alter the flow of global commerce.

Suez is back to normal, yet the waters of the canal run still amid the flow of an otherwise changing world as businesses scramble for new and quicker routes to transport their goods following a year of crisis. Things are moving again between the Red and Mediterranean seas, but one might wonder if this proves to be a turning point for Suez, with its significance starting to wane.
Newsletter

Related Articles

0:00
0:00
Close
UK Introduces Stricter Subcontractor Checks and Expanded Trade Union Access
Green Party Proposes Three-Year Emergency Freeze on Private Rent Increases
UK Treasury Committee Seeks Tax Clarification Over Manchester City Investigation
Royal Marines Deploy to Faroe Islands for Northern European Security Exercise
UK Business Confidence Weakens as High Costs Delay Investment
UK GDP Growth Revised Up to 0.5% in Second Quarter
Bank of England Warns of Financial Stability Risks From Autonomous AI
UK Expands Early Prisoner Release Scheme to Ease Overcrowding
UK Records Worst Bluetongue Outbreak on Record Across Livestock Farms
UK Government Faces Shrinking Fiscal Headroom Ahead of October 28 Budget
UK 30-Year Gilt Yield Reaches 6% as Energy Shock Drives Borrowing Costs Higher
Church of England to Apologize for Role in Historical Forced Adoptions
UK Defence Ministry Investigates Historical Use of RAF Bases by Jeffrey Epstein
Scottish Housing Completions Fall to 11-Year Low
Welsh First Minister Calls for Expanded Devolution Settlement
UK Pledges £50 Million to Expand Domestic Military Drone Capabilities
UK Opens First Commercial Geothermal Plant in Cornwall
Green Party Wins Gorton and Denton By-Election as Labour Falls to Third
Prime Minister Andy Burnham Opens Review of UK-EU Relationship
UK Inflation Rises to 3.1%, Adding Pressure on Household Finances
UK Removes VAT From Domestic Electricity Bills to Ease Winter Energy Costs
Counterterrorism Police Arrest Sixth Suspect Over RAF Fairford Incident
UK Councils to Receive Sweeping Planning Powers to Ban New Vape and Betting Shops
Chancellor John Healey Faces Tax and Pension Scrutiny Ahead of Autumn Budget
Metropolitan Police Apologise for Accidental Disclosure in High-Profile Investigation
UK Universities Report Record International Enrolment as Housing Pressure Grows
UK Logistics Firms Monitor Rhine Disruption as Low Water Threatens European Supply Chains
UK Food Industry Warns Inflation Could Approach 7%
UK Introduces Vaping Duty and Mandatory Retail Stamps
Scotland Raises Property Taxes and Expands Child Payment in Annual Budget
Greggs Plans Four Factory Closures With 740 Jobs at Risk
OECD Raises UK 2026 Growth Forecast to 1.1%
UK Inflation Rises to 3.1% as Bank of England Faces Rate Debate
Andy Burnham Criticises Brexit and Says Rejoining EU Single Market Remains an Option
UK Imposes New Sanctions on Russian Military Networks and Propagandists
UK Launches Nationwide Early-Release Prison Scheme
Andy Burnham Says Security Services See Signs of Iranian Involvement in RAF Fairford Incident
Manchester City Found Guilty on Premier League Financial Charges After Independent Investigation
Scottish Court to Rule on Bid to Force No-Confidence Vote Against Aberdeen Council Co-Leader
UK Bans Extra Charges for Seating Children Under 12 Beside Accompanying Adults
UK Introduces Vaping Duty and New Licensing Requirements
Greggs to Close Four UK Factories and Cut 740 Jobs
Hundreds of Prisoners Released Early as England and Wales Prisons Reach 98% Capacity
UK Unveils New Russia Sanctions Targeting War Funding and Shadow Fleet
Burnham Says There Are Strong Indications of Iranian Involvement in RAF Fairford Security Breach
Prime Minister Andy Burnham Raises Prospect of Reviewing Britain's Post-Brexit EU Relationship
Markets Price in Bank of England Rate Increases as Inflation Rises to 3.1%
UK Borrowing Costs Climb Toward 5.5% as Global Bond Sell-Off Intensifies
UK-France One-In-One-Out Migration Agreement Expires as London Seeks Alternative Measures
Southwest England Faces Flood Alerts After Heavy Autumn Storms
×